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Meager Funding Hinders Poverty Alleviation

Less than ten percent of the social welfare budget is allocated to the State Welfare Organization (SWO) and Imam Khomeini Relief Foundation (IKRF). The two organizations, therefore, cannot contribute significantly to alleviate poverty, Ahmad Meydari, deputy labor minister stated.

“Executive and bureaucratic inefficiency and problems concerning social welfare have their roots in insufficient and improper allocation of the available budget resources,” the official said at the panel on ‘Regional Approaches in Social Welfare,’ in the Sixth Five-Year Economic Development Plan, starting 2016. The panel was organized by the National Conference of Social Welfare.

He further said the budget allocated to welfare this year is $30 billion, one of the highest in comparison with other countries. While 45 percent of the national budget goes to social welfare, nearly $14 billion is paid in cash subsidies. Out of the approximate $17 billion remaining, only $1.5 billion is allocated to the SWO and IKRF (less than ten percent). Thus the two organizations cannot help in poverty reduction, ISNA quoted him as saying.

In the next calendar year, (starting March 21, 2015) nearly $450 million from the budget will be provided to the banks to help individuals with low incomes. Plans will be carried out to target housing. However, the problem is that “even if there are 10 financial underwriters referring people to twenty banks, there is no monitoring as to how many people will ultimately receive the funds and how much of the monetary resources will be distributed,” the official said. In other words, there is no financial accountability.

Standard Data Base

Meydari further said there is pressing need for the administrative organizations to use a standard information system. “Since the year 2004, the formation of a comprehensive data base system has been on the cards; however it has not been seriously followed.” If a standardized electronic database is introduced, several problems which now exist could be removed. Poverty, for instance, cannot be effectively tackled as long as a unified database does not exist and social organizations do not cooperate.

People’s welfare and a healthy society are important elements of the national fabric. A society can achieve reasonable welfare, when there is support to the social organizations and an honest administrative system exists. Promotion of charitable activities must be equally encouraged, he observed.